Core Viewpoint - Huakang Co., Ltd. has decided to terminate the planned acquisition of 100% equity in Yuxin Sugar Alcohol due to significant changes in the market environment since the initial planning phase, despite the transaction being in progress for over a year [2][4]. Group 1: Transaction Details - The company intended to acquire Yuxin Sugar Alcohol for a total price of 1.098 billion yuan through a combination of issuing shares and cash payments [2]. - The assessment value of Yuxin Sugar Alcohol's 100% equity as of December 31, 2024, was 1.101 billion yuan, reflecting an increase of 556 million yuan and an appreciation rate of 102.01% [2][3]. Group 2: Company Performance - Huakang Co., Ltd. has faced a situation of increasing revenue without corresponding profit growth, with a revenue increase of 0.93% to 2.808 billion yuan in 2024, while net profit decreased by 27.72% to 268 million yuan [4]. - In the first three quarters of 2025, the company reported a revenue of 2.959 billion yuan, a year-on-year increase of 40.52%, but net profit declined by 9.91% to 168 million yuan [4]. Group 3: Industry Context - The company and Yuxin Sugar Alcohol are recognized as leading firms in the production and technology of xylitol, with the acquisition aimed at enhancing market competitiveness and operational efficiency [4]. - The industry is currently facing challenges, including a major customer of Yuxin Sugar Alcohol experiencing a debt crisis, which may impact the market dynamics [4].

Core Viewpoint - The company aims to optimize its financial structure and enhance its credit rating and financing capabilities through a capital increase in its subsidiary, Jin Jian International Trade Co., Ltd. This move is intended to improve operational efficiency and strengthen the stability of its supply chain and market competitiveness [1] Group 1: Capital Increase Details - The company will increase its capital in Jin Jian International Trade Co., Ltd. by 90 million yuan, funded from its own resources [1] - Following the capital increase, the registered capital of Jin Jian International Trade Co., Ltd. will rise from 10 million yuan to 100 million yuan [1] - The company will directly hold 99% of Jin Jian International Trade Co., Ltd. and indirectly hold 1% through its wholly-owned subsidiary, Hunan Jin Jian Rice Industry Marketing Co., Ltd., resulting in a total ownership of 100% [1] Group 2: Subsidiary Operations - Jin Jian International Trade Co., Ltd. is a wholly-owned subsidiary that primarily supports the company's core production and processing needs [1] - The subsidiary focuses on procurement and sales activities related to key agricultural products such as oils, rice, and wheat flour [1]